netflix
Bulletins

Netflix won't crack down on password sharing until 2023, ads coming early next year

The streaming service made the announcement in conjunction with its Q2 2022 earnings; Netflix lost nearly 1 million subscribers during the quarter.

Ads are coming to Netflix as part of a cheaper tier, but not until next year.

Ads are coming to Netflix as part of a cheaper tier, but not until next year.

Photo: Robyn Beck/AFP via Getty Images

Get ready to pay up to share your Netflix account: The streaming service will begin to crack down on password sharing starting next year, the company announced in its letter to investors Tuesday. That's also when Netflix plans to launch an ad-supported tier.

"Our goal is to find an easy-to-use paid sharing offering that we believe works for our members and our business that we can roll out in 2023," the company wrote. The letter also states that Netflix is aiming to launch an ad-supported tier "around the early part of 2023."

Netflix first announced plans to monetize shared accounts and launch a cheaper, ad-supported tier in April. The company struck a deal with Microsoft to sell and power its ads last week.

Netflix executives have said in the past there were an estimated 100 million households who participated in account sharing. The company had already begun a test asking people to pay more for the ability to share their accounts in Chile, Costa Rica and Peru.

On Monday, the company announced a separate test with a slightly different approach: Starting in August, Netflix will ask members in Argentina, the Dominican Republic, El Salvador, Guatemala and Honduras to pay more if they want to stream to more than one home.

"We’re encouraged by our early learnings and ability to convert consumers to paid sharing in Latin America," the company said Tuesday.

Netflix also announced Tuesday that it had lost another 0.97 million subscribers in Q2. The company expects to add 1 million subscribers in Q3, compared to 4.38 million added subscribers in Q3 of 2021.

Disclosure: Protocol is owned by Axel Springer, whose chairman and chief executive officer, Mathias Döpfner, is on the board of Netflix.

Janko Roettgers

Janko Roettgers (Twitter, Mastodon) used to be a senior reporter at Protocol, reporting on the shifting power dynamics between tech, media, and entertainment, including the impact of new technologies. Previously, Janko was Variety's first-ever technology writer in San Francisco, where he covered big tech and emerging technologies. He has reported for Gigaom, Frankfurter Rundschau, Berliner Zeitung, and ORF, among others. He has written three books on consumer cord-cutting and online music and co-edited an anthology on internet subcultures. He lives with his family in Oakland.

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